Sega HQ in Japan says that they're bracing for "extraordinary loss" for the fiscal year ending tomorrow, and will launch a plan to reform the company to be smaller and tighter, with a cost to the company coming in at around 7.1 billion yen ($86.5b USD).

Sega says that amid the "severe economic environment" in the US and Europe they're forced to implement a restructuring that will streamline organizations and cancel some games. That streamlining part? That probably means layoffs.

The release did not give much in the way of details on specific games for these cancellations, but we're guessing that franchies Sonic the Hedgehog, Football Manager, Total War and Aliens are safe, as they were listed as "strong IPs." While we'll have to wait for details, franchises outside the listed are probably fair game.

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